• Finland has some of the most ambitious climate targets in the world – it intends to be climate neutral by 2035.
  • This bold strategy identifies the central role technological innovation can play in finding scalable alternatives to fossil fuels.
  • But technology alone cannot solve the climate crisis – governments around the world need to create policy frameworks that enable the green transition.

This is one of a series of articles written by Young Global Leaders with action-oriented ideas to improve the state of the world by 2030.

Climate change and biodiversity loss are the most pressing challenges of our time, so all responsible political leaders must offer long-term policies for confronting them effectively. We need clear strategies based on achievable targets, and we must be bold in deploying all means at our disposal. In particular, any credible climate strategy must take proper account of technological innovation.

With the goal of becoming climate neutral by 2035 and carbon negative (removing more atmospheric carbon than is emitted) soon thereafter, Finland’s climate targets are among the most ambitious in the world. My country aims to be a leader among advanced economies, not just in terms of emissions reductions, but also by ushering in a circular economy focused on sustainability and the elimination of waste. Our plan is to double our resource efficiency and circularity rate (the percentage of all material that is fed back into the economy) by 2035.

These are the key benchmarks on our path to becoming the first country to liberate itself from fossil fuels. But achieving climate targets is not possible without better methods of preserving our valuable natural resources. Scientific discovery, new technologies, and innovation will play a central role in any long-term solution.

Investing in credible alternatives to fossil fuels

But, first, all national leaders must examine more closely how they intend to move their countries away from fossil fuels. The focus should be on increasing the use of fuels and energy sources that do not compromise biodiversity. We must encourage uptake of fuels that adhere to strict sustainability criteria and reduce emissions throughout their lifecycle.

For example, the byproducts of biomass fuels can be used for high-quality sustainable and biodegradable products such as textiles and construction materials, thereby safeguarding biodiversity by reducing the demand for resources harvested from our forests. And “Power-to-X” conversion technologies open the door for a variety of processes that turn electricity into heat, hydrogen, or synthetic fuels.

The best [climate change] solutions will be the ones that can be scaled-up in industrialized and developing countries alike.

—Sanna Marin, Prime Minister of Finland.

With more investment and innovation, these technologies could allow us to part ways with coal, oil, and natural gas, by making it possible to produce synthetic fuels from captured carbon-dioxide emissions. Here, one can start with the existing industrial flue gases generated by bio-based industry, cement kilns, and solid waste incinerators. But soon enough, new technologies could be developed to harness less concentrated sources of carbon, such as by collecting exhaust air from office buildings, or even by direct air capture (DAC).

Experimentation is already underway. Using hydrogen produced by electrolysis, CO2 emissions from industrial plants and DAC could become a source of synthetic liquid and gaseous fuels for carbon-neutral road, maritime, and air transportation. These methods produce synthetic methanol as an intermediate product, which can then be converted into gasoline, kerosine, and diesel. Strange as it may sound, we are not far from being able to create fuels out of thin air.

Achieving economies of scale

These new technologies and processes may start out with a large price tag. But as we’ve seen with solar panels and fuel cells, a technology’s costs tend to plummet as soon as its usage starts to scale-up. Moreover, markets for other new climate-friendly technologies are developing quickly, though these vary in depth and scope, depending on the level of government support (through measures such as blending regulations for fuels and carbon pricing).

What's the World Economic Forum doing about the transition to clean energy?

Moving to clean energy is key to combating climate change, yet in the past five years, the energy transition has stagnated.

Energy consumption and production contribute to two-thirds of global emissions, and 81% of the global energy system is still based on fossil fuels, the same percentage as 30 years ago. Plus, improvements in the energy intensity of the global economy (the amount of energy used per unit of economic activity) are slowing. In 2018 energy intensity improved by 1.2%, the slowest rate since 2010.

Effective policies, private-sector action and public-private cooperation are needed to create a more inclusive, sustainable, affordable and secure global energy system.

Benchmarking progress is essential to a successful transition. The World Economic Forum’s Energy Transition Index, which ranks 115 economies on how well they balance energy security and access with environmental sustainability and affordability, shows that the biggest challenge facing energy transition is the lack of readiness among the world’s largest emitters, including US, China, India and Russia. The 10 countries that score the highest in terms of readiness account for only 2.6% of global annual emissions.

To future-proof the global energy system, the Forum’s Shaping the Future of Energy and Materials Platform is working on initiatives including, Systemic Efficiency, Innovation and Clean Energy and the Global Battery Alliance to encourage and enable innovative energy investments, technologies and solutions.

Additionally, the Mission Possible Platform (MPP) is working to assemble public and private partners to further the industry transition to set heavy industry and mobility sectors on the pathway towards net-zero emissions. MPP is an initiative created by the World Economic Forum and the Energy Transitions Commission.

Is your organisation interested in working with the World Economic Forum? Find out more here.

For example, promising new hydrogen-based technologies will require a massive increase in fossil-fuel-free electricity production in order to achieve scale. But this need can be met by expanding the use of wind and solar power, which are already the least costly options for power generation in many parts of the world.

New technologies will enable a major shift toward sustainably fuelled transportation in many developed and developing countries. They will not only allow us to reduce global CO2 emissions, but will also position many industries to become carbon-negative in the future.

Government's must lead green transition

But technology will not solve the climate crisis for us. We also need to create the right policy environment. A key component of the green transition will be higher carbon pricing, which requires coordination and support at an international level. Agreeing on sustainable criteria for carbon-market mechanisms would be an important step forward. And governments should do more to support structural changes through regulatory frameworks and financial incentives.

The global transition away from fossil fuels will require a transformational shift in energy production and industrial processes. Even then, much more work will need to be done to develop a genuinely circular and green economy. Different countries will have different needs and advantages. But the best solutions will be the ones that can be scaled-up in industrialized and developing countries alike.

The bottom line is that global emissions must peak soon if we want to achieve our emissions-reduction targets and avert future climate disasters. The full suite of promising new technologies will need to be developed, optimized, and deployed globally if we are going to create a fully climate-neutral, circular world economy.

This decade the world will likely witness more social, economic and environmental changes than over the last century. While the COVID-19 pandemic called for immediate reforms, the mainstreaming of stakeholder capitalism, the impacts of climate change, the escalation of next-generation technologies, and the empowerment of citizenship will pave the way for a ‘resetting’ of the global economy and social practices.

This article series presents pioneering, forward-looking, and action-oriented ideas that should be adopted up to 2030 to improve the state of the world. The WEF invited a group of individuals who have been selected as Young Global Leaders (YGLs) in the course of their careers. Authors include heads of government, business leaders and scientists, prominent intellectuals or civil society leaders.

On an annual basis and since 2004, the World Economic Forum identifies the world’s most promising leaders under the age of 40 — people driving innovation for positive change across civil society, arts, culture, government and business. This series, an initiative of the Forum of Young Global Leaders of the World Economic Forum, harnesses the expertise and experience of this group of leaders.

For additional information on the article series, please contact Rodrigo Tavares (curator).